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L.B. Foster Company’s (FSTR - Free Report) shares have appreciated 25.3% in the past six months. The company also outperformed the industry’s decline of 9.1% and topped the S&P 500’s nearly 16% rise over the same period.
Image Source: Zacks Investment Research
Let’s take a look at the factors driving the stock’s price appreciation.
What’s Driving L.B. Foster?
L.B. Foster witnessed solid growth in the first quarter of 2024. Despite facing challenges like divestitures and product line exits, the company's net sales soared to $124.3 million, marking an impressive 8% increase from the previous year. What's even more impressive is the company's organic growth, standing at a robust 16.9%, a testament to its strong market presence and operational prowess.
The strategic transformation contributed meaningfully, as evidenced by a $3 million uptick in gross profit compared to the previous year. Moreover, reducing net debt by $2.5 million further solidifies L.B. Foster's stability and sets the stage for continued success.
The Rail business, which experienced a lackluster performance in 2023, bounced back significantly in the first quarter of 2024, delivering a remarkable 29.4% organic sales growth.
Looking ahead, L.B. Foster is optimistic about its prospects for the rest of 2024. The company expects adjusted EBITDA between $34 million and $39 million, with net sales projected to be in the $525-$560 million range. Additionally, it foresees a healthy free cash flow of $12-$18 million for the full year while maintaining disciplined capital spending at 2-2.5% of sales. This strategic approach ensures that the company continues to invest in key areas essential for long-term success.
In terms of earnings performance, L.B. Foster exceeded expectations in the first quarter, with adjusted earnings per share of 8 cents, comfortably surpassing the Zacks Consensus Estimate of a loss of 16 cents. The company has a trailing four-quarter earnings surprise averaging around 12.6%.
The Zacks Consensus Estimate for CRS’s current-year earnings is pegged at $4.31, indicating a year-over-year rise of 278%. CRS’ earnings beat the Zacks Consensus Estimate in three of the last four quarters while matching it once, with the average earnings surprise being 15.1%. The company’s shares have soared 98.5% in the past year.
ATI’s earnings beat the Zacks Consensus Estimate in each of the last four quarters, with the earnings surprise being 8.34%, on average. The stock has surged 42.6% in the past year.
The Zacks Consensus Estimate for Ecolab's current-year earnings is pegged at $6.59, indicating a year-over-year rise of 26.5%. ECL beat the consensus estimate in each of the last four quarters, with the earnings surprise being 1.3%, on average. The stock has rallied nearly 32.6% in the past year.
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L.B. Foster (FSTR) Shares Rally 25% in 6 Months: Here's Why
L.B. Foster Company’s (FSTR - Free Report) shares have appreciated 25.3% in the past six months. The company also outperformed the industry’s decline of 9.1% and topped the S&P 500’s nearly 16% rise over the same period.
Image Source: Zacks Investment Research
Let’s take a look at the factors driving the stock’s price appreciation.
What’s Driving L.B. Foster?
L.B. Foster witnessed solid growth in the first quarter of 2024. Despite facing challenges like divestitures and product line exits, the company's net sales soared to $124.3 million, marking an impressive 8% increase from the previous year. What's even more impressive is the company's organic growth, standing at a robust 16.9%, a testament to its strong market presence and operational prowess.
The strategic transformation contributed meaningfully, as evidenced by a $3 million uptick in gross profit compared to the previous year. Moreover, reducing net debt by $2.5 million further solidifies L.B. Foster's stability and sets the stage for continued success.
The Rail business, which experienced a lackluster performance in 2023, bounced back significantly in the first quarter of 2024, delivering a remarkable 29.4% organic sales growth.
Looking ahead, L.B. Foster is optimistic about its prospects for the rest of 2024. The company expects adjusted EBITDA between $34 million and $39 million, with net sales projected to be in the $525-$560 million range. Additionally, it foresees a healthy free cash flow of $12-$18 million for the full year while maintaining disciplined capital spending at 2-2.5% of sales. This strategic approach ensures that the company continues to invest in key areas essential for long-term success.
In terms of earnings performance, L.B. Foster exceeded expectations in the first quarter, with adjusted earnings per share of 8 cents, comfortably surpassing the Zacks Consensus Estimate of a loss of 16 cents. The company has a trailing four-quarter earnings surprise averaging around 12.6%.
L.B. Foster Company Price and Consensus
L.B. Foster Company price-consensus-chart | L.B. Foster Company Quote
Zacks Rank and Other Key Picks
L.B. Foster currently sports a Zacks Rank #1 (Strong Buy).
Some other top-ranked stocks in the Basic Materials space are Carpenter Technology Corporation (CRS - Free Report) , ATI Inc. (ATI - Free Report) )and Ecolab Inc. (ECL - Free Report) . While Carpenter Technology and ATI sport a Zacks Rank #1 at present, Ecolab carries a Zacks Rank #2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for CRS’s current-year earnings is pegged at $4.31, indicating a year-over-year rise of 278%. CRS’ earnings beat the Zacks Consensus Estimate in three of the last four quarters while matching it once, with the average earnings surprise being 15.1%. The company’s shares have soared 98.5% in the past year.
ATI’s earnings beat the Zacks Consensus Estimate in each of the last four quarters, with the earnings surprise being 8.34%, on average. The stock has surged 42.6% in the past year.
The Zacks Consensus Estimate for Ecolab's current-year earnings is pegged at $6.59, indicating a year-over-year rise of 26.5%. ECL beat the consensus estimate in each of the last four quarters, with the earnings surprise being 1.3%, on average. The stock has rallied nearly 32.6% in the past year.